derive a general analytic formula for the "risk premium" governing the resulting climate policy. The formula generalizes … simple precautionary savings analysis to more complex economic interactions and it builds the economic intuition for policy … making under uncertainty. It clarifies the distinct roles of risk aversion, prudence, characteristics of the damage …

In the expected-utility theory of the monetary value of a statistical life, the so-called dead-anyway effect discovered … risk increases with the initial level of risk. Their reasoning is based on differences in the marginal utility of wealth …: first, for a risk-averse individual without a bequest motive, marginal WTP for survival does increase with the level of risk …

We show how optimal saving in a two-period model is affected when prudence and risk aversion of the underlying utility … function change. Increasing prudence alone will induce higher savings only if, for certain combinations of the interest rate … and the pure time discount rate, there is distributional neutrality between the two periods. Otherwise, changes of risk …

degree of pessimism of the representative agent is the mean of the individual ones weighted by their index of absolute risk …

first-order approximated solution built by perturbation methods accounts for risk. We show that risk matters economically in … a real business cycle (RBC) model with habit formation and capital adjustment costs and that neglecting risk leads to …

How does risk affect saving? Empirical work typically examines the effects of detectible differences in risk within the … data. How these differences affect saving in theoretical models depends on the metric one uses for risk. For labor …-income risk, second-degree increases in risk require prudence to induce increased saving demand. However, prudence is not …

selfʺ emerges when labor supply and savings decisions are made. The social welfare function is paternalistic: the rate of … show that the paternalistic solution does not necessarily imply forced savings for the myopics. This is because …

risk of workers, which mitigates their precautionary savings motive. Using a quantitative model analysis, we show that this … recessions. First, we show that the consumption risk of short-time work is considerably smaller compared to unemployment using …

funded and unfunded systems when there are sources of uninsurable risk that are allocated in different ways by different …